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FHFA Rescinds Multifamily Lease Policies

March 26, 2025

Newly appointed Federal Housing Finance Agency (FHFA) Director William Pulte published orders on social media platform X on March 24, rescinding a 2024 FHFA directive entitled “Aligned Policies on Multifamily Rental Payment Flexibility and Lease Notices.”

Why it matters: The order eliminates a Biden-era policy requiring that GSE multifamily loan documents mandate various notices and grace periods for tenants. 

• The July 2024 press release noted that this is “the first time that tenant protections will be a standard component of Enterprise multifamily financing.”
• Effective February 28, 2025, covered housing providers would have been required to provide tenants with the following:
  • 30-day written notice of a rent increase;
  • 30-day written notice of a lease expiration; and
  • 5-day grace period for rent payments.

Yesterday, Pulte also ordered the rescission of an advisory bulletin requiring the GSEs to develop a “climate-related risk management framework into its existing enterprise risk management program.”

As covered in CREFC’s most recent Policy and Capital Markets Briefing, last week Pulte revamped the boards of both Fannie Mae and Freddie Mac and is now chair of each board. Freddie Mac CEO Diana Reid was let go and FHFA Chief Operating Officer Gina Cross and Human Resources Director Monica Matthews were placed on leave.

Please contact Sairah Burki (sburki@crefc.org) with any questions.

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Proposed Georgia Bill Caps Institutional Housing Ownership

March 25, 2025

The Georgians First Residential Property Protection Act (HB 555), a bill in the Georgia state legislature, would limit business enterprises from owning more than 2,000 single-family homes or 10 multifamily properties in the state. 

Why it matters: The measure, sponsored by four Republicans and one Democrat, demonstrates increasingly bipartisan political concern over single-family rentals (SFR), but the limitation on multifamily property ownership signals a new pushback on institutional ownership of housing.

• In a committee hearing on March 3, the bill sponsor testified in support of a revised bill expressing concern about increased corporate ownership of SFRs in Georgia. The sponsor cited data that indicated no institution owned more than 1,000 single-family homes prior to 2011.
• Enforcement would be through a private right of action rather than state enforcement against businesses that own more than 2,000 homes. 
• The bill was reported favorably out of the Georgia House Judiciary Committee with only one legislator voting in opposition. The full state House has not yet acted on the bill. 

The big picture: Georgia legislative observers indicate the bill likely will not advance further this session. 

• However, the near-unanimous committee approval with 12 Republicans and five Democrats on the committee indicates the growing local concern on the issue.
• On the federal level, legislation targeting institutional ownership has been limited to Democrats, but moderates have been joining with progressives in supporting the legislation.

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Capital Markets Update Week of 3/25

March 25, 2025

Private-Label CMBS and CRE CLOs

Four transactions totaling $3.9 billion priced last week:

• BX 2025-SPOT, a $1.3 billion SASB backed by a floating-rate, five-year loan (at full extension) for Blackstone to refinance a portfolio consisting of 95 industrial properties, two data centers, and a land parcel totaling 11.7 million sf in 10 states.
• BXMT 2025-FL5, a $1.0 billion CRE CLO sponsored by Blackstone Mortgage Trust, Inc. The managed transaction is comprised of 19 loans secured by 90 properties. The top three property types are multifamily (53.7%), hotel (22.2%), and industrial (10.3%).
• BMARK 2025-V14, a $939.2 million conduit backed by 35 five-year loans secured by 61 properties from Deutsche, Citi, Goldman, Barclays, and BMO.
• BMO 2025-5C9, a $681.7 million conduit backed by 31 mostly five-year loans secured by 54 properties from BMO, Citi, Goldman, 3650, UBS, Deutsche, SocGen, and LoanCore.

By the numbers: Year-to-date, private-label CMBS and CRE CLO issuance totaled $44.1 billion, 130% higher than the $19.2 billion for same-period 2024. 

Spreads Largely Steady

• Conduit AAA and A-S spreads were unchanged at +98 and +140, respectively.
• Conduit AA spreads were unchanged at +180, while A spreads widened by 10 bps to +220.
• Conduit BBB- spreads widened 25 bps at +500.
• SASB AAA spreads were unchanged, ranging from +135 to +145, depending on property type.
• CRE CLO AAA and BBB- spreads were unchanged at +130/+135 (Static / Managed) and +355/+370 (Static / Managed). 

Agency CMBS

• Agency issuance totaled $3 billion last week, consisting of $1.6 billion of Fannie DUS, $1.2 billion of Freddie K, SB, and Multi-PC transactions, and $222.6 million of Ginnie transactions.
• Agency issuance for the year totaled $29.8 billion, 26% higher than the $23.6 billion for same-period 2024.

The Economy, the Fed, and Rates…

• Treasury yields end week lower: The 10-year Treasury yield finished the week down 7 bps to 4.25%, while the two-year yield also dropped 7 bps to 3.95% as investors sought safety amid uncertainty about Trump's tariff policies.
• Markets price in rate cut timing: Traders are anticipating around 65 basis points of Fed rate cuts by year-end, with the next move expected in July. This reflects tempered expectations from earlier in the year when markets had priced in close to three cuts.
• Bonds rally on growth concerns: Bond investors have focused on the Fed's lowered growth forecasts, validating concerns that Trump's trade war and spending cuts will cool the economy. Kevin Flanagan, Head of Fixed Income Strategy at Wisdom Tree, noted:

• Stock volatility continues: The S&P 500 experienced a 10% correction from mid-February, erasing $4 trillion in market value before recovering slightly. Stephanie Roth, Chief Economist at Wolfe Research, notes tariffs have been implemented more aggressively than anticipated:

• Market technicals reflect caution: Trend-following systematic funds have turned net short on US equities, signaling a bearish technical outlook. Retail investors continue aggressive buying – a potentially concerning sign as they historically tend to exit markets last, suggesting equities may still have further downside potential.

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